Council gives only limited support for bus fare increase
Council gives only limited support for bus fare increase
JAKARTA (JP): City Council Speaker Edy Waluyo rejected on
Monday a possible bus fare increase following the central
government's decision to raise fuel prices by 30 percent later
this week.
Should bus operators insist on increasing fares, the increase
should be limited to air-conditioned buses only, which generally
target higher-income commuters.
As for regular buses, Edy said, the council would fight to
maintain current bus fare levels as any increase would affect
less privileged people.
He suggested that the city administration subsidize regular
buses by using the city budget's reserve fund, which totals Rp
400 billion (US$36 million).
"The city council would not reject the subsidy if it were for
poor people. We will allow the administration to decide on the
technicalities of the subsidy," Edy said.
The fares for city buses currently range from Rp 500, for non
air-conditioned and regular buses, to Rp 2,500 for air-
conditioned buses.
Bus operators have claimed that the fuel price increase would
raise operational costs for public buses and also raise the cost
of spare parts. For these reasons, they have demanded that the
city administration adjust bus fares in line with the fuel price
increase.
Separately, City Governor Sutiyoso suggested that a bus fare
increase was unavoidable because of the central government's
decision to raise the price of fuel.
"Drivers and bus owners do not want to suffer losses due to
the fuel price hike, do they?," Sutiyoso said on Monday.
Nevertheless, he insisted the fare increase should not exceed
the change in fuel price.
He said the bus fare increase was necessary to keep bus
operators in the city in business.
Jakarta currently has about 20,000 big, medium and small
public buses. Only 35 percent of that number are operational,
however, while the remaining 65 percent, mostly old buses, are
immobile.
The city administration is currently planning a rejuvenation
program for public buses. It plans to purchase some 2,000 buses
from local manufacturer PT Texmaco, as well as importing buses
from China and Korea.
The acquisition from Texmaco was previously suspended because
no financial institutions were willing to fund the purchase.
Banks have rejected loans to bus operators, saying that the
funds could not be repaid while they were charging such low
fares.
Governor Sutiyoso said recently that the administration was
seeking bank loans to finance the purchase of Texmaco buses,
called Perkasa.
Edy Waluyo said on Monday that the city administration should
decide quickly whether it would go ahead with its plan to buy
buses from Texmaco.
"It should be decided quickly. If not, the decision could hang
in the balance," Edy said.
Edy said that it would be better for the city administration
to buy buses from a local company like Texmaco rather than
importing them from overseas, in order to boost employment at
local companies.
He suggested that city-owned Bank DKI take the initiative to
arrange loans with other banks to finance the purchase of Perkasa
buses.
"Bank DKI probably does not have the funds, but it could act
as a broker. I don't know whether the bank has tried that
before," Edy added. (jun)